we are committed to you
At Mortgage Solutions, we understand that a mortgage is one of the biggest financial decisions you will make in your life. We are fully committed to helping you through the process and finding you the right deal.
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Our expert advisers are on hand to offer excellent advice and help you throughout the mortgage process. Be sure to contact us today to see how we can take care of the leg-work for you and assist you in securing your property.
You've come to the right place. Getting the right mortgage advice is so important. We have access to a broad range of lenders and our expert team of advisers search through thousands of mortgage products to find you the best deal. We understand how stressful this process can be and that's why we are here to walk you through step by step. We'll handle all of the leg work for you; once we have found the right mortgage deal for you, we will handle all of the paperwork, submit your application and guide you through the legal process until completion.
Throughout every step of the process, you will be partnered with one of our friendly mortgage advisers who will answer any of your questions along the way. Regardless of whether you are looking to re-mortgage, move home or purchase your first property, we are help to help you.
Below, we explain just what a mortgage is and how they work, the different types of mortgages as well as the different repayment options. It's vital you understand this as it will help you to make an informed decision on what product is right for you. One of our trusted advisers will offer a helping-hand to guide you through the complex field of mortgages whilst explaining in a simple and jargon-free way. This information should be helpful to you. If you would like further information or have more questions for us, call us today on 01245 323500, where we can discuss your options in more detail. ​
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A mortgage is a sum of money used as a loan to purchase a property
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When you purchase a property, you put down a cash deposit (normally at least 5% of the total purchase price) and then pay the rest back to a bank or building society
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The mortgage is paid back over a set number of years on a monthly basis including interest charges
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If you fail to keep up with the monthly repayments, the lender is able to repossess (take ownership) of the property
what types of mortgages are there?
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Most mortgages are classified as either a repayment mortgage or an interest- only mortgage
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Repayment Mortgage = ​each monthly payment includes a part of the loan and a part of the interest amount
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Interest-Only Mortgage = each monthly payment includes only a part of the interest, leaving the original balance of the mortgage to be paid in full at the end of the term
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The mortgages interest rate is calculated on the Bank of England base rate
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The lower the BoE base rate, the lower the interest rate on the mortgage meaning the lower your monthly repayments
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It is important to consider all available mortgage types depending on your personal circumstances, therefore it is crucial to get advice on the right product for you
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The most common mortgage types are: Fixed Rate, Tracker Rate, Discounted Rate or Offset Rate
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what is a mortgage?
fixed rate
These are the most popular type of mortgage - especially for first time buyers - as they allow you to precisely budget from month to month. This is because your interest rate is guaranteed to stay the same for a set period of time. This is usually 2, 3, 5 or sometimes up to 10 or even 15 years.
The advantage of these products is that if mortgage interest rates go up, your monthly payment stays the same. However, some mortgages can come with large penalties if you want to sell your home or pay off a large lump sum within the fixed rate period.
Fixed rate
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Tracker rate
These types of mortgages' interest rates are is based upon the Bank of England base rate, plus an additional set percentage. Therefore, when the rate is lower, you will benefit from your monthly repayment being lower too - but likewise this can increase if the rate does too.
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Some of the best tracker mortgages also have a 'collar rate' which is a minimum cap based on your introductory interest rate. Meaning if the base rate were to drop, your repayments would not drop below the 'collar rate' however your payments would still increase if the base rate increases.
tracker rate
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discounted rate
These types of mortgages offer an interest that is applied at a set % below the lenders SVR (Standard Variable Rate), for either a set period of time or for the full term of the mortgage.
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The SVR is an interest rate controlled by the lender and can be amended higher or lower at any given time. A discount rate mortgage is a type of variable-rate mortgage so your payments could change from month to month alongside the SVR.
discounted rate
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A fixed-rate mortgage is a mortgage where your interest rate is guaranteed to stay the same for a set period of time. This can offer peace of mind because, unlike a variable-rate mortgage (such as a tracker), you’ll know exactly how much you’ll need to repay each month during this period.
offset rate
offset rate
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An offset rate mortgage reduces the amount you pay interest on by subtracting savings held in a linked bank account from the total mortgage amount. This in turn could reduce your monthly repayments by paying less interest. E.g. if you have £30,000 in savings account that is linked to an offset mortgage of £350,000, you need only pay interest on £320,000.
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It is important to remember that offset mortgages often have a higher interest rate and that you won't normally earn any interest on money held in the linked bank accounts.
what are the different
repayment options?
When you are looking to take out a mortgage, there are three different repayment options for you to consider. Let's take a look at them below.
Capital & Interest
This is sometimes called a 'Repayment' mortgage as each monthly payment you make combines both the debt and the interest; at the end of the term you will be mortgage free and will have no further payments to make.
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This is important to consider as although the mortgage payments are higher than other repayment options, this way ensures you are guaranteed to be mortgage free at the end of the term. Therefore when you retire and your income decreases, you will not need to worry about making large mortgage payments.
interest only
As the name suggests, each payment that you make will only repay the interest for the term and not any of the debt sum. This reduces the monthly cost of the mortgage, however at the end of the term, the debt still needs to be paid in full.
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You will need to plan to clear the mortgage at the end of the term; ways to do this include savings, pensions and of course, sale of the property. However, none of these options are guaranteed to repay the debt in full.
part & part
This repayment type is a combination of both of the above; part of the mortgage is on a repayment term and the other part is on interest only terms. This combines the two for monthly cost, however as with the interest only option, you need to plan ways to repay the debt in full during the interest only period.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP MORTGAGE REPAYMENTS.
NOT ALL BUY TO LET MORTGAGES ARE REGULATED BY THE FINANCIAL CONDUCT AUTHORITY.
YOU MAY HAVE TO PAY AN EARLY REPAYMENT CHARGE TO YOUR EXISTING LENDER IF YOU REMORTGAGE.